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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

For the year ended December 31, 2004

OR

For the transition period from              to             

Commission file number: 0-16467

RANCON REALTY FUND V,

A CALIFORNIA LIMITED PARTNERSHIP

(Exact name of registrant as specified in its charter)

Partnership’s telephone number, including area code (650) 343-9300

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act:

Units of Limited Partnership Interest

(Title of class)

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  x

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days    Yes  x    No  ¨

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act).    Yes  ¨    No  x

No market for the Limited Partnership units exists and therefore a market value for such units cannot be determined.

DOCUMENTS INCORPORATED BY REFERENCE:

Exhibits: The index of exhibits is contained herein on page number 38.

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INDEX

RANCON REALTY FUND V,

A CALIFORNIA LIMITED PARTNERSHIP

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Part I

Item 1. Business

Rancon Realty Fund V, a California Limited Partnership, (“the Partnership”) was organized in accordance with the provisions of the California Revised Limited Partnership Act for the purpose of acquiring, developing, operating and ultimately selling real property. The Partnership was organized in 1985 and completed its public offering of limited partnership units (“Units”) in February 1989. The general partners of the Partnership are Daniel L. Stephenson (“DLS”) and Rancon Financial Corporation (“RFC”), collectively, the “General Partner.” RFC is wholly owned by DLS. The Partnership has no employees.

The Partnership’s initial acquisition of property in September 1985 consisted of approximately 76.21 acres of partially developed and unimproved land located in San Bernardino, California. The property is part of a master-planned development of 153 acres known as Tri-City Corporate Centre (“Tri-City”) and is zoned for mixed commercial, office, hotel, transportation-related, and light industrial uses. The balance of Tri-City is owned by Rancon Realty Fund IV (“Fund IV”), a partnership sponsored by the General Partner of the Partnership. Since the acquisition of the land, the Partnership has constructed eleven projects at Tri-City consisting of five office projects, one industrial property, a 25,000 square foot health club, three restaurants, and a retail space. The Partnership’s properties are more fully described in Item 2.

As of December 31, 2004, the Partnership owned eleven rental properties (“Tri-City Properties”), and approximately 10.5 acres of land (“Tri-City land”). Construction has commenced on a one-acre land parcel and approximately 5 acres of land is in a pre-design stage. The remaining 4.5 acres are currently undeveloped. The Partnership’s plan is to develop more properties on the remaining acres of unimproved land to generate more operating income for the Partnership in this fast-growing market.

In May 1996, the Partnership formed RRF V Tri-City Limited Partnership, a Delaware limited partnership (“RRF V Tri-City”). The limited partner of RRF V Tri-City is the Partnership and the General Partner is RRF V, Inc. (“RRF V, Inc.”), a corporation wholly owned by the Partnership. Since the Partnership owns 100% of RRF V, Inc. and indirectly owns 100% of RRF V Tri-City, the Partnership considers all assets owned by RRF V, Inc. and RRF V Tri-City to be owned by the Partnership.

In 2003, a total of 1,998 Units were redeemed at an average price of $375. In 2004, a total of 1,509 Units were redeemed at an average price of $394. As of December 31, 2004, there were 87,410 Units outstanding.

Competition Within the Market

The Partnership competes in the leasing of its properties primarily with other available properties in the local real estate market. Management is not aware of any specific competitors of the Partnership’s properties doing business on a significant scale in the local market. Management believes that characteristics influencing the competitiveness of a real estate project are the geographic location of the property, the professionalism of the property manager, the maintenance and appearance of the property and rental rates, in addition to external factors such as general economic circumstances, trends, and the existence of new competing properties in the vicinity. Additional competitive factors with respect to commercial and industrial properties include the ease of access to the property, the adequacy of related facilities, such as parking, and the ability to provide rent concessions and tenant improvements commensurate with local market conditions. Although management believes the Partnership’s properties are competitive with comparable properties as to those factors within the Partnership’s control, over-building and other external factors could adversely affect the ability of the Partnership to attract and retain tenants. The marketability of the properties may also be affected (either positively or negatively) by these factors as well as by changes in general or local economic conditions, including prevailing interest rates. Depending on market and economic conditions, the Partnership may be required to retain ownership of its properties for periods longer than anticipated, or may need to sell earlier than anticipated or refinance a property at a time or under terms and conditions that are less advantageous than would be the case if unfavorable economic or market conditions did not exist.

Working Capital

The Partnership’s practice is to maintain cash reserves for normal repairs, replacements, working capital and other contingencies. The Partnership knows of no statistical information which allows comparison of its cash reserves to those of its competitors.

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Item 2. Properties

Tri-City Corporate Centre

In 1985, the Partnership acquired 76.21 acres of partially developed land in Tri-City for a total acquisition price of $14,118,000. In 1984 and 1985, a total of 76.56 acres within Tri-City were acquired by Fund IV.

Tri-City is located at the northeastern quadrant of the intersection of Interstate 10 (San Bernardino Freeway) and Waterman Avenue in the southernmost part of the City of San Bernardino, and is in the heart of the Inland Empire, the most densely populated area of San Bernardino and Riverside counties.

The Inland Empire is generally broken down into two major markets, Inland Empire East and Inland Empire West. Tri-City is located within the Inland Empire East market, which consists of approximately 12.4 million square feet of office space and an overall vacancy rate of approximately 11% as of December 31, 2004, according to research conducted by an independent broker.

Within the Tri-City as of December 31, 2004, the Partnership has 441,000 square feet of office space with a vacancy rate of 2%, 51,000 square feet of R & D space with a vacancy rate of 13% and 55,000 square feet of retail space with no vacancy.

Tri-City Properties

The Partnership’s improved properties in the Tri-City Corporate Centre are as follows:

These eleven properties total approximately 547,000 rentable square feet and offer a wide range of commercial, R & D, office and retail product to the market.

Occupancy rates for the Partnership’s Tri-City buildings for each of the five years ended December 31, 2004, expressed as a percentage of the total net rentable square feet, were as follows:

In 2004, management renewed 17 leases, totaling 116,869 square feet and executed 11 new leases totaling 32,613 square feet of space. In 2005, 16 leases, totaling 86,476 square feet, are due to expire. Of these, management has renewed 10 leases totaling 59,009 square feet, while 5 tenants occupying 10,744 square feet have indicated that they will vacate upon expiration of their leases. The remaining one tenant occupying 16,723 square feet of space has not yet indicated whether it plans to renew its lease or vacate the premises. Management is actively marketing the space.

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The annual effective rents per square foot for each of the five years ended December 31, 2004 were as follows:

Annual effective rent is calculated by dividing the aggregate of annualized current monthly rental income for each tenant by the total square feet occupied at the property.

The Partnership’s Tri-City properties had the following tenants that occupied a significant portion of the net rentable square footage as of December 31, 2004:

continued

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On February 1, 2005, New York Life Insurance relocated to Vanderbilt Plaza, a new building developed by Fund IV.

Paychex has extended their lease for one year.

Computer Associates has not yet exercised their lease renewal option. Management is aggressively working with the tenant to renew their lease prior to its expiration.

The Partnership’s Tri-City rental properties are owned by the Partnership, in fee, subject to the following note and lines of credit:

The interest rate for the line of credit related to One Carnegie Plaza and Carnegie Business Center II is a variable interest rate of “Prime Rate” plus 0.75%. This line of credit had a maturity date of March 5, 2005. On that date, the Partnership extended the maturity date of this line of credit to June 5, 2005. The Partnership intends to either extend the term of the existing line of credit or to refinance the properties with a lower interest rate loan to replace the line of credit after the 90-day extension.

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The note payable may be prepaid with a penalty based on a yield maintenance formula. There is no prepayment penalty if the note is repaid within six months of the maturity date of the note. The Partnership’s plan is to either sell the properties or refinance with a lower interest rate loan to pay off this high interest rate note when the prepayment penalty period ends on December 1, 2005.

Tri-City Land

As of December 31, 2004, the Partnership owned approximately 10.5 acres of land. Construction has commenced on a one-acre land parcel (discussed below). Approximately 5-acres of land, known as Brier Corporate Center, is in a pre-design stage. The remaining 4.5 acres are currently undeveloped. The Partnership’s plan is to develop properties on the remaining acres of unimproved land to generate more operating income for the Partnership in this fast-growing market.

A two-story office building of 86,200 square feet, known as Three Carnegie, is currently under construction. The estimated construction cost is approximately $6,400,000, which is estimated to be completed in June 2005. In April 2004, the Partnership obtained a new line of credit with a total availability of $7,425,000, secured by Two Parkside, to provide the funding for the construction costs.

Item 3. Legal Proceedings

Certain claims and lawsuits have arisen against the Partnership in its normal course of business. The Partnership believes that such claims and lawsuits will not in the future have a material adverse effect on the Partnership’s financial position, cash flow or results of operations.

Item 4. Submission of Matters to a Vote of Security Holders

None.

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Part II

Item 5. Market for Partnership’s Common Equity and Related Stockholder Matters

Market Information

There is no established trading market for the Units issued by the Partnership.

Holders

As of December 31, 2004, there were 9,357 holders of Partnership Units.

Distributions

Distributions are paid from either Cash From Operations or Cash From Sales or Refinancing (as such terms are defined in the Partnership Agreement).

Cash From Operations includes all cash receipts from operations in the ordinary course of business (except for the sale, exchange or other disposition of real property in the ordinary course of business) after deducting payments for operating expenses. All distributions of Cash From Operations are paid in the ratio of 90% to the Limited Partners and 10% to the General Partner.

Cash From Sales or Refinancing is the net cash realized by the Partnership from the sale, disposition or refinancing of any property after redemption of applicable mortgage debt and all expenses related to the transaction, together with interest on any notes taken back by the Partnership upon the sale of a property. All distributions of Cash From Sales or Refinancing are generally allocated as follows: (i) first, 1 percent to the General Partner and 99 percent to the Limited Partners until the Limited Partners have received an amount equal to their capital contributions; (ii) second, 1 percent to the General Partner and 99 percent to the Limited Partners until the Limited Partners have received a 12 percent return on their unreturned capital contributions including prior distributions of Cash From Operations; plus their Limited Incremental Preferred Return for the twelve month period following the purchase date of each Unit and following admission as a Limited Partner; (iii) third, 99 percent to the General Partner and 1 percent to the Limited Partners until the General Partner has received an amount equal to 20 percent of all distributions of Cash From Sales or Refinancing previously made under clauses (ii) and (iii) above, reduced by the amount of prior distributions made to the General Partner under clauses (ii) and (iii); and (iv) fourth, the balance 20 percent to the General Partner and 80 percent to the Limited Partners. A more detailed statement of the distribution policies is set forth in the Partnership Agreement.

In 2004, the Partnership distributed from operations $1,555,000 to the Limited Partners and accrued distributions of $172,000 for the General Partner.

In 2003, the Partnership distributed from operations $1,353,000 and $151,000 to the Limited Partners and General Partner, respectively.

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Item 6. Selected Financial Data

The following is selected financial data for each of the five years ended December 31, 2004 (in thousands, except per Unit data):

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with the financial statements and the notes thereto as listed in Item 15 of Part IV.

Results of Operations

Comparison of the year ended December 31, 2004 to the year ended December 31, 2003

Revenue

Rental income increased $1,803,000, or 21%, for the year ended December 31, 2004, compared to the year ended December 31, 2003, primarily due to the increases in occupancy at Two Parkside.

Occupancy rates at the Partnership’s Tri-City properties for each of the five years ended December 31, 2004 were as follows:

As of December 31, 2004, tenants at Tri-City occupying substantial portions of leased rental space included: (i) New York Life Insurance with a lease through January 31, 2005 (see below for detail); (ii) Paychex with a lease through July 2005; (iii) Computer Associates with a lease through November 2005; (iv) Chicago Title with leases through May 2007 and February 2009; (v) First Franklin Financial with a lease through February 2009; (vi) Gresham, Savage, Nolan & Tilden with a lease through March 2009; (vii) Arrowhead Central Credit Union with two leases through September 2005 and September 2010; (viii) Holiday Spa Health Club with a lease through December 2010; and (ix) Lewis, D’amato, Brisbois and Bisgaard, LLP with a lease through December 2012. These nine tenants, in the aggregate, occupy approximately 230, 000 square feet of the 547,000 total rentable square feet at Tri-City and account for approximately 45% of the rental income generated at Tri-City for the Partnership as of December 31, 2004.

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On February 1, 2005, New York Life Insurance relocated to Vanderbilt Plaza, a new building developed by Fund IV.

The 5% increase in occupancy from December 31, 2003 to December 31, 2004 at Carnegie Business Center II was due to leasing 2,400 square feet to a new tenant.

Two Parkside began lease-up in September 2003. The 35% increase in occupancy from December 31, 2003 to December 31, 2004 at Two Parkside is due to leasing the remaining 29,000 square feet to two new tenants in March and April 2004.

Pat & Oscars began occupancy in March 2004 with a ground lease of 15 years.

Expenses

Property operating increased $603,000, or 16%, during the year ended December 31, 2004, compared to the year ended December 31, 2003, primarily due to the additional operating costs associated with the completion of three new properties developed by the Partnership.

Depreciation and amortization expense increased $292,000, or 13%, during the year ended December 31, 2004, compared to the year ended December 31, 2003, primarily due to depreciation of one new building, land improvements and tenant improvements placed into service.

Expenses associated with undeveloped land decreased $84,000, or 30%, for year ended December 31, 2004, compared to the year ended December 31, 2003, primarily due to decreased capitalization of property taxes and insurance at two East Lake pads and Three Carnegie during the construction period. The two East Lake pads were completed in March 2004.

Non-operating income /expenses

Interest and other income for the year ended December 31, 2004 decreased $30,000 from the year ended December 31, 2003, primarily due to a lower invested cash balance resulting from payment of the construction costs at Two Parkside.

Interest expense increased $688,000, or 135%, during the year ended December 31, 2004, compared to the year ended December 31, 2003, primarily due to interest paid on increased borrowings from the two lines of credit, offset by interest capitalized during construction at Three Carnegie and two East Lake pads. The two East Lake pads were completed in March 2004.

Comparison of the year ended December 31, 2003 to the year ended December 31, 2002

Revenue

Rental income increased $1,103,000, or 15%, for the year ended December 31, 2003, compared to the year ended December 31, 2002, primarily due to the increases in occupancy at One Carnegie Plaza, Two Carnegie Plaza, Lakeside Tower, Chuck E. Cheese and Two Parkside, as well as an increase in rental rates, offset by the decrease in occupancy at Carnegie Business Center II.

Occupancy rates at the Partnership’s Tri-City properties for each of the five years ended December 31, 2003 were as follows:

As of December 31, 2003, tenants at Tri-City occupying substantial portions of leased rental space included: (i) Chicago Title with a lease through February 2004; (ii) New York Life Insurance with a lease through May 2004; (iii) Paychex with a lease through July 2004; (iv) Computer Associates with a lease through November 2005; (v) Holiday Spa Health Club with a lease through December 2010; (vi) Lewis, D’Amato & Brisbois et al with a lease through December 2012; and (vii) Arrowhead Central Credit Union with two leases through September 2004 and 2010. These seven tenants, in the aggregate, occupied approximately 199,000 square feet of the 542,000 total rentable square feet at Tri-City and accounted for approximately 42% of the rental income generated at Tri-City for the Partnership as of December 31, 2003.

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The 5% increase in occupancy from December 31, 2002 to December 31, 2003 at One Carnegie Plaza was due to leasing 1,100 square feet to a new tenant, and expansion of two existing tenants into approximately 4,100 square feet of space.

The 4% increase in occupancy from December 31, 2002 to December 31, 2003 at Two Carnegie Plaza was due to expansion of two existing tenants into approximately 2,600 square feet of space.

The 9% decrease in occupancy from December 31, 2002 to December 31, 2003 at Carnegie Business Center II was due to a tenant of 4,300 square feet moving out upon its lease expiration.

The 5% increase in occupancy from December 31, 2002 to December 31, 2003 at Lakeside Tower was due to leasing 5,800 square feet to a new tenant.

Land improvement at Harriman Plaza was completed, and costs were transferred from construction in progress to land and land improvements in June 2003. A new tenant, Chuck E. Cheese, occupies the whole site as a restaurant and started paying ground lease rent in June 2003.

Construction of the core and shell for Two Parkside, a Class A three-story building was completed in June 2003, and costs were transferred from construction in progress to land, land improvements and building. On September 26, 2003, an anchor tenant moved into two floors totaling 53,003 rentable square feet. Two other tenants executed leases which brought this building to 100% occupancy by April 2004. One of these two tenants leased 14,422 square feet for March 2004 occupancy, and the other leased 14,491 square feet for April 2004 occupancy.

Expenses

Property operating increased $350,000, or 11%, during the year ended December 31, 2003, compared to the year ended December 31, 2002, primarily due to increases in occupancy at One Carnegie Plaza, Two Carnegie Plaza, Chuck E. Cheese and Two Parkside, as well as an increase in utility and janitorial costs.

Depreciation and amortization expense increased $510,000, or 28%, during the year ended December 31, 2003, compared to the year ended December 31, 2002, primarily due to depreciation of the new building, land improvements and tenant improvements.

Expenses associated with undeveloped land decreased $104,000, or 27%, for year ended December 31, 2003, compared to the year ended December 31, 2002, primarily due to capitalization of property taxes and insurance at Two Parkside and Harriman Plaza during the construction period.

Non-operating income /expenses

Interest and other income for the year ended December 31, 2003 decreased $150,000 from the year ended December 31, 2002, primarily due to a lower invested cash balance resulting from payment of the construction costs at Two Parkside and Harriman Plaza.

Interest expense decreased $349,000, or 41%, during the year ended December 31, 2003, compared to the year ended December 31, 2002, primarily due to interest capitalized during construction at Two Parkside and Harriman Plaza, offset by interest on a new line of credit.

Liquidity and Capital Resources

As of December 31, 2004, the Partnership had cash and cash equivalents of $967,000.

The Partnership’s liabilities at December 31, 2004, included a note payable and two lines of credit totaling approximately $17,465,000, secured by properties with an aggregate net book value of approximately $30,374,000. The note payable requires monthly principal and interest payments of $83,000, bears a fixed interest rate of 9.39%, and has a maturity date of June 1, 2006. One line of credit with a total availability of $6,000,000 requires monthly interest-only payments, bears an interest rate of prime plus 0.75% with a floor set at 5.5% (6% and 5.5% as of December 31, 2004 and 2003, respectively), and had a maturity date of March 5, 2005. On that date, the Partnership extended the maturity date of this line of credit to June 5, 2005. The Partnership intends to either extend the term of the existing line of credit or to refinance the properties with a lower interest rate loan to replace this line of credit after the 90-day extension. Another line of credit with a total availability of $7,425,000 requires monthly interest-only payments, bears an interest rate of prime rate (5.25% and 4% as of December 31, 2004 and 2003, respectively), and has a maturity date of April 15, 2007.

The Partnership is contingently liable for subordinated real estate commissions payable to the General Partner in the amount of $102,000 at December 31, 2004 for sales that occurred in previous years. The subordinated real estate commissions are payable only after the

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Limited Partners have received distributions equal to their original invested capital plus a cumulative non-compounded return of nine percent per annum on their adjusted invested capital. Since the circumstances under which these commissions would be payable are limited, the liability has not been recognized in the accompanying consolidated financial statements; however, the amount will be recorded when and if it becomes payable.

Operationally, the Partnership’s primary source of funds consists of cash provided by its rental activities. Other sources of funds may include permanent financing, draws on the lines of credit, proceeds from property sales, interest income on certificates of deposit and other deposits of funds invested temporarily. Cash generated from property sales is generally added to the Partnership’s cash reserves, pending use in development of other properties or distribution to the partners.

Management expects that the Partnership’s cash balance at December 31, 2004, together with cash from operations and financings will be sufficient to finance the Partnership’s and the properties’ continuing operations and development plans on a short-term basis and the reasonably foreseeable future. In April 2004, the Partnership obtained a new line of credit with a total availability of $7,425,000 to cover the construction costs at Three Carnegie, a two-story office building of 86,200 square feet (as discussed above). There can be no assurance that the Partnership’s results of operations will not fluctuate in the future and at times affect its ability to meet its operating requirements.

Contractual Obligations

At December 31, 2004, we had contractual obligations as follows (in thousands):

The Partnership knows of no demands, commitments, events or uncertainties, which might affect its capital resources in any material respect. In addition, the Partnership is not subject to any covenants pursuant to its secured debt that would constrain its ability to obtain additional capital.

Operating Activities

During the year ended December 31, 2004, the Partnership’s cash provided by operating activities totaled $2,678,000.

The $600,000 increase in deferred costs during 2004 was primarily due to lease commissions paid for Lakeside Tower, Pat & Oscars and One & Two Parkside.

The $116,000 increase in prepaid expenses and other assets during 2004 was primarily due to an increase in tenant rents recognized on a straight line basis and prepaid insurance, offset by a decrease in impound accounts resulting from property tax payments.

The $214,000 increase in accounts payable and other liabilities during 2004 was primarily due to accruals for interest expense and supplementary property taxes for Two Parkside.

The $403,000 decrease in prepaid rent during 2004 was due to January 2004 rents received in December 2003, offset by January 2005 rents received in December 2004.

Investing Activities

During the year ended December 31, 2004, the Partnership’s cash used for investing activities totaled $4,193,000, which consisted of $579,000 for land improvements at two East Lake pads, $213,000 for building improvements at One & Two Parkside, One & Two Carnegie Plaza and Carnegie Business Center II, $1,039,000 for tenant improvements at Lakeside Tower, One & Two Parkside and One Carnegie Plaza, and $2,472,000 for construction costs at Three Carnegie, offset by the partial collection of $110,000 from a note receivable related to tenant improvements.

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Financing Activities

During the year ended December 31, 2004, the Partnership’s cash provided by financing activities totaled $1,346,000, which consisted of $3,840,000 of draws on the two lines of credit (as discussed above), offset by $203,000 in principal payments on the note payable, $141,000 in loan fees paid for the refinance of the line of credit, $1,555,000 of distributions to the Limited Partners, and $595,000 paid to redeem limited partnership Units, of which $46,000 was accrued at December 31, 2004 for final settlement in the first quarter of 2005.

Critical Accounting Policies

Revenue recognized on a straight-line basis

The Partnership recognizes rental revenue on a straight-line basis at amounts that it believes it will collect on a tenant-by-tenant basis. The estimation process may result in higher or lower levels from period to period as the Partnership’s collection experience and the credit quality of the Partnership’s tenants changes. Actual amounts collected could be lower or higher than the amounts recognized on a straight-line basis if specific tenants are unable to pay rent that the Partnership has previously recognized as revenue.

Carrying value of rental properties and land held for development

The Partnership’s rental properties, including the related land, are stated at cost unless events or circumstances indicate that cost cannot be recovered, in which case, the carrying value of the property is reduced to its estimated fair value. Estimated fair value is based upon (i) the Partnership’s plans for the continued operations of each property, and (ii) is computed using estimated sales price, as determined by prevailing market values for comparable properties and/or the use of capitalization rates multiplied by annualized rental income based upon the age, construction and use of the building. The fulfillment of the Partnership’s plans related to each of its properties is dependent upon, among other things, the presence of economic conditions which will enable the Partnership to continue to hold and operate the properties prior to their eventual sale. Due to uncertainties inherent in the valuation process and in the economy, it is reasonably possible that the actual results of operating and disposing of the Partnership’s properties could be materially different than current expectations.

Land held for development is stated at cost unless events or circumstances indicate that cost cannot be recovered, in which case, the carrying value is reduced to estimated fair value. Estimated fair value: (i) is based on the Partnership’s plans for the development of each property; (ii) is computed using estimated sales price, based upon market values for comparable properties; and (iii) considers the cost to complete and the estimated fair value of the completed project. The fulfillment of the Partnership’s plans related to each of its properties is dependent upon, among other things, the presence of economic conditions which will enable the Partnership to either hold the properties for eventual sale or obtain financing to further develop the properties.

The actual value of the Partnership’s portfolio of properties and land held for development could be significantly higher or lower than their carrying amounts.

Accounting Pronouncements Issued But Not Yet Adopted

In December 2004, the FASB issued SFAS No. 123 revised 2004, “Share-Based Payment”. This Statement is a revision of SFAS No. 123, “Accounting for Stock-Based Compensation”, and supersedes APB No. 25, “Accounting for Stock Issued to Employees”. The Statement requires companies to recognize in the income statement the grant-date fair value of stock options and other equity based compensation issued to employees. This Statement is effective as of the beginning of the first interim or annual period that commences after June 15, 2005. The Partnership anticipates that the adoption of SFAS No. 123 revised 2004 will have no impact on its financial position, net earnings or cash flows.

In December 2004, the FASB issued SFAS No. 153, “Exchanges of Non-Monetary Assets an amendment of APB No. 29”. This Statement amends APB Opinion No. 29, “Accounting for Non-Monetary Transactions” to eliminate the exception for non-monetary exchanges of similar productive assets and replaces it with a general exception for exchanges of non-monetary assets that do not have commercial substance. That exception required that some non-monetary exchanges be recorded on a carryover basis versus this Statement, which requires that an entity record a non-monetary exchange at fair value and recognize any gain or loss if the transaction has commercial substance. This Statement is effective for fiscal years beginning after June 15, 2005. The Partnership anticipates that the adoption of SFAS No. 153 will not have a material impact on its financial position, net earnings or cash flows.

In November 2004, the FASB issued EITF Issue No. 03-13, “Applying the Conditions in Paragraph 42 of FASB Statement No. 144, Accounting for Impairment or Disposal of Long-Lived Assets, in Determining Whether to Report Discontinued Operations” (EITF No. 03-13). This issue assists in the development of a model for evaluating (a) which cash flows are to be considered in determining whether cash flows have been or will be eliminated and (b) what types of continuing involvement constitute significant continuing involvement. The guidance in this issue should be applied to a component of an enterprise that is either disposed of or classified as held for sale in fiscal periods beginning after December 15, 2004. Previously reported operating results related to disposal transactions initiated within an enterprise’s fiscal year that includes the date that this consensus was ratified (November 30, 2004) may be reclassified. The adoption of EITF No. 03-13 on January 1, 2005, had no impact on the Partnership’s financial position, net earnings or cash flows.

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Forward Looking Statements; Factors That May Affect Operating Results

This Report on Form 10-K contains forward looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities and Exchange Act of 1934, including statements regarding the Partnership’s expectations, hopes, intentions, beliefs and strategies regarding the future. These forward looking statements include statements relating to:

All forward-looking statements included in this document are based on information available to the Partnership on the date hereof. Because these forward looking statements involve risk and uncertainty, there are important factors that could cause our actual results to differ materially from those stated or implied in the forward-looking statements. Those important factors include:

The forward-looking statements in this Annual Report on Form 10-K are subject to additional risks and uncertainties further discussed below under Risk Factors. The Partnership assumes no obligation to update or supplement any forward looking-statement.

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Risk Factors

Market Fluctuations in Rental Rates and Occupancy Could Adversely Affect Our Operations

As leases turn over, our ability to re-lease the space to existing or new tenants at rates equal to or greater than those realized historically is impacted by, among other things, the economic conditions of the market in which a property is located, the availability of competing space (including sublease space offered by tenants who have vacated space in competing buildings prior to the expiration of their lease term), and the level of improvements which may be required at the property. We cannot assure you that the rental rates we obtain in the future will be equal to or greater than those obtained under existing contractual commitments. If we cannot lease all or substantially all of the expiring space at our properties promptly, or if the rental rates are significantly lower than expected, then our results of operations and financial condition could be negatively impacted.

Tenants’ Defaults Could Adversely Affect Our Operations

Our ability to manage our assets is subject to federal bankruptcy laws and state laws that limit creditors’ rights and remedies available to real property owners to collect delinquent rents. If a tenant becomes insolvent or bankrupt, we cannot be sure that we could recover the premises from the tenant promptly or from a trustee or debtor-in-possession in any bankruptcy proceeding relating to that tenant. We also cannot be sure that we would receive rent in the proceeding sufficient to cover our expenses with respect to the premises. If a tenant becomes bankrupt, the federal bankruptcy code will apply, which in some instances may restrict the amount and recoverability of our claims against the tenant. A tenant’s default on its obligations to us could adversely affect our results of operations and financial condition.

We May Suffer Adverse Consequences If Our Revenues Decline Since Our Operating Costs Do Not Necessarily Decline In Proportion To Our Revenue

We earn a significant portion of our income from renting our properties. Our operating costs, however, do not necessarily fluctuate in relation to changes in our rental revenue. This means that our costs will not necessarily decline even if our revenues do. Our operating costs could also increase while our revenues do not. If our operating costs increase but our rental revenues do not, we may be forced to borrow to cover our costs, we may incur losses and we may not have cash available for distributions to our partners.

Potential Liability Due to Environmental Matters

Under federal, state and local laws relating to protection of the environment, or Environmental Laws, a current or previous owner or operator of real estate may be liable for contamination resulting from the presence or discharge of petroleum products or other hazardous or toxic substances on the property. These owners may be required to investigate and clean-up the contamination on the property as well as the contamination which has migrated from the property. Environmental Laws typically impose liability and clean-up responsibility without regard to whether the owner or operator knew of, or was responsible for, the presence of the contamination. This liability may be joint and several unless the harm is divisible and there is a reasonable basis for allocation of responsibility. In addition, the owner or operator of a property may be subject to claims by third parties based on personal injury, property damage and/or other costs, including investigation and clean-up costs, resulting from environmental contamination. Environmental Laws may also impose restrictions on the manner in which a property may be used or transferred or in which businesses may be operated. These restrictions may require expenditures. Under the Environmental Laws, any person who arranges for the transportation, disposal or treatment of hazardous or toxic substances may also be liable for the costs of investigation or clean-up of those substances at the disposal or treatment facility, whether or not the facility is or ever was owned or operated by that person.

Our tenants generally are required by their leases to operate in compliance with all applicable Environmental Laws, and to indemnify us against any environmental liability arising from their activities on the properties. However, we could be subject to strict liability by virtue of our ownership interest in the properties. Also, tenants may not satisfy their indemnification obligations under the leases. We are also subject to the risk that:

Any one of these conditions could have an adverse effect on our results of operations and financial condition. Moreover, future environmental laws, ordinances or regulations may have an adverse effect on our results of operations and financial condition. Also, the current environmental condition of those properties may be affected by tenants and occupants of the properties, by the condition of land or operations in the vicinity of the properties (such as the presence of underground storage tanks), or by third parties unrelated to us.

Environmental Liabilities May Adversely Affect Operating Costs and Ability to Borrow

The obligation to pay for the cost of complying with existing Environmental Laws as well as the cost of complying with future legislation may affect our operating costs. In addition, the presence of petroleum products or other hazardous or toxic substances at any of our properties, or the failure to remediate those properties properly, may adversely affect our ability to borrow by using those properties as collateral. The cost of defending against claims of liability and the cost of complying with Environmental Laws, including investigation or clean-up of contaminated property, could materially adversely affect our results of operations and financial condition.

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General Risks of Ownership of Real Estate

We are subject to risks generally incidental to the ownership of real estate. These risks include:

Should any of these events occur, our results of operations and financial condition could be adversely affected.

Uninsured Losses May Adversely Affect Operations

We, or in certain instances, tenants of our properties, carry property and liability insurance with respect to the properties. This coverage has policy specification and insured limits customarily carried for similar properties. However, certain types of losses (such as from earthquakes and floods) may be either uninsurable or not economically insurable. Further, certain of the properties are located in areas that are subject to earthquake activity and floods. Should a property sustain damage as a result of an earthquake or flood, we may incur losses due to insurance deductibles, co-payments on insured losses or uninsured losses. Additionally, we have elected to obtain insurance coverage for “certified acts of terrorism” as defined in the Terrorism Risk Insurance Act of 2002; however, our policies of insurance may not provide coverage for other acts of terrorism. Any losses from such other acts of terrorism might be uninsured. Should an uninsured loss occur, we could lose some or all of our capital investment, cash flow and anticipated profits related to one or more properties. This could have an adverse effect on our results of operations and financial condition.

Illiquidity of Real Estate May Limit Our Ability to Vary Our Portfolio

Real estate investments are relatively illiquid and, therefore, will tend to limit our ability to vary our portfolio quickly in response to changes in economic or other conditions.

Potential Liability Under the Americans With Disabilities Act

All of our properties are required to be in compliance with the Americans With Disabilities Act. The Americans With Disabilities Act generally requires that places of public accommodation be made accessible to people with disabilities to the extent readily achievable. Compliance with the Americans With Disabilities Act requirements could require removal of access barriers. Non-compliance could result in imposition of fines by the federal government, an award of damages to private litigants and/or a court order to remove access barriers. Because of the limited history of the Americans With Disabilities Act, the impact of its application to our properties, including the extent and timing of required renovations, is uncertain. Pursuant to lease agreements with tenants in certain of the “single-tenant” properties, the tenants are obligated to comply with the Americans With Disabilities Act provisions. If our costs are greater than anticipated or tenants are unable to meet their obligations, our results of operations and financial condition could be adversely affected.

Risks of Litigation

Certain claims and lawsuits have arisen against us in our normal course of business. We believe that such claims and lawsuits will not have a material adverse effect on our financial position, cash flow or results of operations.

Item 7A. Qualitative and Quantitative Disclosures about Market Risk

Interest Rates

The Partnership’s primary market risk exposure is to changes in interest rates obtainable on its secured borrowings. The Partnership expects that changes in market interest rates will not have a material impact on the performance or fair value of its portfolio. The Partnership does not own any derivative instruments.

For debt obligations, the table below presents principal cash flows and interest rates by expected maturity dates.

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A change of 1/8% in the index rate to which the Partnership’s variable rate debt is tied would not have a material impact on the annual interest incurred by the Partnership, based upon the balances outstanding on variable rate instruments at December 31, 2004.

As of December 31, 2004, the Partnership had no investments in interest-bearing certificates of deposit.

Item 8. Financial Statements and Supplementary Data

For information with respect to this item, see Financial Statements and Schedule as listed in Item 15.

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None.

Item 9A. Controls and procedures

As of the end of the period covered by this report, we carried out an evaluation, under the supervision of the General Partner’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on this evaluation, the General Partner’s Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures are effective in alerting him on a timely basis to material information required to be included in this report. There has been no change in our internal control over financial reporting that occurred during our most recent fiscal quarter that has materially affected or is reasonably likely to materially affect our internal control over financial reporting.

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Part III

Item 10. Directors and Executive Officers of the Partnership

Daniel L. Stephenson and Rancon Financial Corporation (“RFC”) are the general partners of the Partnership. The executive officer and director of RFC is Daniel L. Stephenson who is Director, President, Chief Executive Officer and Chief Financial Officer.

Mr. Stephenson founded RFC (formerly known as Rancon Corporation) in 1971 for the purpose of establishing a commercial, industrial and residential property syndication, development and brokerage concern. Mr. Stephenson has, from inception, held the position of Director. In addition, Mr. Stephenson was President and Chief Executive Officer of RFC from 1971 to 1986, from August 1991 to September 1992, and from March 1995 to present. Mr. Stephenson is Chairman of the Board of PacWest Group, Inc., a real estate firm that has acquired a portfolio of assets from the Resolution Trust Corporation.

Item 11. Executive Compensation

The Partnership has no executive officers. For information relating to fees, compensation, reimbursement and distributions paid to related parties, reference is made to Item 13 below.

Item 12. Security Ownership of Certain Beneficial Owners and Management

Security Ownership of Certain Beneficial Owners

No person is known by the Partnership to be the beneficial owner of more than 5% of the Units outstanding.

Security Ownership of Management

Changes in Control

The Limited Partners have no right, power or authority to act for or bind the Partnership. However, the Limited Partners generally have the power to vote upon the following matters affecting the basic structure of the Partnership, passage of each of which requires the approval of Limited Partners holding a majority of the outstanding Units: (i) amendment of the Partnership Agreement; (ii) termination and dissolution of the Partnership; (iii) sale, exchange or pledge of all or substantially all of the assets of the Partnership; (iv) removal of the General Partner or any successor General Partner; (v) election of a new General Partner or General Partner upon the removal, redemption, death, insanity, insolvency, bankruptcy or dissolution of the General Partner or any successor General Partner; (vi) modification of the terms of any agreement between the Partnership and the General Partner or an affiliate of the General Partner; and (vii) extension of the term of the Partnership.

Item 13. Certain Relationships and Related Transactions

During the year ended December 31, 2004, the Partnership did not incur any expenses or costs reimbursable to RFC or any other affiliate of the Partnership.

Item 14. Principal Accountant Fees and Services

The Partnership was billed $71,000 and $67,500 in 2004 and 2003, respectively for professional services rendered by the principal accountant in connection with the audit of the annual financial statements included on Form 10-K and review of the quarterly financial statements included on Form 10-Q.

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Part IV

Item 15. Exhibits, Financial Statement Schedules, and Reports on Form 8-K

Report of Independent Registered Public Accounting Firm

Consolidated Balance Sheets as of December 31, 2004 and 2003

Consolidated Statements of Operations for the years ended December 31, 2004, 2003 and 2002

Consolidated Statements of Partners’ Equity for the years ended December 31, 2004, 2003 and 2002

Consolidated Statements of Cash Flows for the years ended December 31, 2004, 2003 and 2002

Notes to Consolidated Financial Statements

Schedule III — Real Estate and Accumulated Depreciation as of December 31, 2004 and Notes thereto

All other schedules are omitted because they are not applicable or the required information is shown in the financial statements or notes thereto.

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None.

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SIGNATURES

Pursuant to the requirements of Section 13 or Section 15(d) of the Securities Exchange Act of 1934, the Partnership has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

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INDEX TO FINANCIAL STATEMENTS

AND SCHEDULE

All other schedules are omitted because they are not applicable or the required information is shown in the consolidated financial statements or notes thereto.

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Report of Independent Registered Public Accounting Firm

The General Partner

RANCON REALTY FUND V, A California Limited Partnership:

We have audited the accompanying consolidated balance sheets of RANCON REALTY FUND V, a California Limited Partnership, and subsidiaries as of December 31, 2004 and 2003, and the related consolidated statements of operations, partners’ equity, and cash flows for each of the years in the three-year period ended December 31, 2004. In connection with our audits of the consolidated financial statements, we have also audited the financial statement schedule listed in the accompanying index to the financial statements and schedule. These consolidated financial statements and financial statement schedule are the responsibility of the Partnership’s management. Our responsibility is to express an opinion on these consolidated financial statements and financial statement schedule based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of RANCON REALTY FUND V, a California Limited Partnership, and subsidiaries as of December 31, 2004 and 2003, and the results of their operations and their cash flows for each of the years in three-year period ended December 31, 2004 in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related information in the financial statement schedule, when considered in relation to the consolidated financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein.

San Francisco, California

March 23, 2005

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RANCON REALTY FUND V

A California Limited Partnership, and Subsidiaries

Consolidated Balance Sheets

December 31, 2004 and 2003

(in thousands, except unit amounts)

The accompanying notes are an integral part of these consolidated financial statements.

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RANCON REALTY FUND V

A California Limited Partnership, and Subsidiaries

Consolidated Statements of Operations

For the years ended December 31, 2004, 2003 and 2002

(in thousands, except per unit amounts and units outstanding)

The accompanying notes are an integral part of these consolidated financial statements.

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RANCON REALTY FUND V

A California Limited Partnership, and Subsidiaries

Consolidated Statements of Partners’ Equity

For the years ended December 31, 2004, 2003 and 2002

(in thousands)